Currency Updates:
U.S. Dollar Trading (US) stocks extended gains on Monday with some positivity coming back into most markets. EUR/CHF continue to rally on short covering with the SNB now set to meet on Wednesday in what could be a watershed moment for the safe haven currency. Traders ignored some weak manufacturing data with the August NY FED dropping to -7 vs. 0 forecast. In US stocks on Friday, DJIA +213 points closing at 11482, S& P +25 points closing at 1204 and NASDAQ +47 points closing at 2555. Looking ahead, July Industrial Production forecast at 0.5% vs. 0.2% previously. July Housing starts are forecast at 0.6mn vs. 0.629mn previously.
The Euro (EUR) the Euro surged above 1.4400 with the rally in global stocks extending for a third day. The market is awaiting some key economic data out today and news from French/German talks currently being held. EUR/GBP is back above 0.8800 with the Euro enjoying broad based strength and support. Looking ahead, Q2 GDP forecast at 0.3% vs. 0.8% previously.
The Japanese Yen (JPY) lost ground against most currencies as the safe haven was sold for riskier currencies such as the AUD and EURO. The USD/JPY remained quiet waiting for a catalyst out of the current range. Better than expected Q2 Japanese GDP is helping keep risk appetite strong.
The Sterling (GBP) was support on risk appetite but failed at the 1.6400 and remain offered against other currencies especially the EURO and outperforming Aussie Dollar. Some very important CPI data is released today with recent inflation data running well above target rate.
The Australian Dollar (AUD) The Aussie surged back to life breaking above 1.0500 in strong US trade with investors demanding the high yielding currency. Commodities where strong and AUD/JPY broke above the Y80 level and is well positioned for more gains. UPDATE RBA Minutes suggest central bank was close to raising rate to fight inflation and was only held back by global market uncertainty.
Oil & Gold (XAU) Investors flooded back to the precious metal as the profit taking subsided and closed above $1760. Crude broke back above $87 a barrel in strong trade with topside now in view.
